When examining a multinational company that operates within an oligopoly in the United States for the purpose of understanding its competitive advantage and forecasting techniques,

 

Ameria Lindsey

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UNIT 3 – DISCUSSION BOARD

Thu 3/21/2024 5:48 PMLikeUnit 3 – Discussion Board Like PostFlagUnit 3 – Discussion Board Flag Post

When examining a multinational company that operates within an oligopoly in the United States for the purpose of understanding its competitive advantage and forecasting techniques, it’s important to conduct a thorough analysis of its operations and strategies. For the sake of this discussion, let’s consider a hypothetical example based on common practices of multinational corporations. We will look at a company such as Boeing, a leading aerospace firm, which operates in an oligopolistic market where there are few competitors, including Airbus.

**Analyzing Boeing’s Competitive Advantage:**

1. **Market Structure and Position:**
  – Boeing operates in an oligopolistic market where it and Airbus are the main competitors in the large commercial aircraft sector. This market structure allows Boeing to have a significant degree of market power and influence over prices.
  – Market share, brand reputation, and long-term contracts with airlines and governments give Boeing a competitive edge.

2. **Unique Resources and Capabilities:**
  – Boeing has an extensive portfolio of aircraft with advanced technology and a focus on fuel efficiency, which is a significant selling point for airlines looking to reduce operational costs.
  – The company’s vast experience in research and development, as well as its skilled workforce, are critical components of its competitive advantage.

3. **Cost Structure and Efficiency:**
  – Economies of scale: Boeing’s ability to spread out fixed costs over a large number of units helps to reduce average costs and maintain competitive pricing.
  – Supply chain optimization and strategic partnerships with suppliers help Boeing to minimize production costs and improve efficiency.

**Forecasting Techniques:**

1. **Market Demand Analysis:**
  – Boeing utilizes sophisticated econometric models to forecast market demand for commercial aircraft. These models consider factors such as global economic growth, airline profitability, and travel demand.
  – They regularly publish a Market Outlook report that provides long-term forecasts of passenger and cargo traffic, which helps them to anticipate future aircraft demand.

2. **Competitive Analysis:**
  – Scenario analysis is employed to anticipate potential moves by Airbus and other competitors, including new entrants and changes in market dynamics.
  – Boeing analyzes the development of new technologies and product offerings by competitors to forecast how these could affect their market position.

3. **Regulatory and Political Environment:**
  – The company monitors regulatory changes and geopolitical events that can impact the aviation industry, including trade policies, environmental regulations, and international relations.

4. **Risk Assessment:**
  – Boeing conducts risk assessments to evaluate uncertainties in the market, such as fluctuations in fuel prices, exchange rates, and the financial health of airline customers.
  – Sensitivity analysis helps Boeing understand how changes in key variables may impact their business projections and competitive advantage.

To effectively estimate and forecast its competitive advantage, Boeing would need to combine these various techniques with continuous market monitoring and data analysis. They would also require strategic planning that considers both the current market landscape and future trends.

Monica Lee

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UNIT 3 – DISCUSSION BOARD

Mon 4/1/2024 11:27 AMLikeUnit 3 – Discussion Board Like PostFlagUnit 3 – Discussion Board Flag Post

Hello To All, 

                Multinational Competitor

Currently, Wal-Mart’s international GMV stands at $100 billion after divesting businesses in the U.K., Argentina, and Japan. The growth strategy involves implementing an omnichannel approach, scaling its marketplaces in 19 foreign countries where Wal-Mart  operates, and building a complementary business ecosystem similar to the successful one in Mexico. 

The multinational competitor that operates in an oligopoly within the United States is the Automobile manufacturing industry.

Leading Auto Manufacturers in the U.S.:

Ford (F): Longest American with the richest history.

General Motors (GM): Iconic American company that produces well-known brands such as Chevrolet, Cadillac, GMC, and Buick.

Stellants: represents the new version of Chrysler.

Global Landscape:

Toyota

Honda

Volkswagen Group

Renault-Nissan-Mitsubishi.

The automobile industry’s oligopolistic structure arises from the high entry costs, substantial capital expenditures, & legal privileges. Additionally, the value of a platform increased with more customers, reinforcing the oligopoly effect. 

In this competitive landscape, these automakers vie for the market share, innovate, & shape the future of mobility. The collective influence significantly impacts the industry as a whole, including pricing, technological advancements, & consumer choices. (ftc.gov)

Wal-Mart’s techniques for estimating & forecasting its competitive advantages are in the following:

1.) Quantitative Analysis of Business Model:

Researchers have developed an analytical framework to quantify the link between a firms business model choices & their ultimate profit consequences.

Wal-Mart sources of competitive advantage over a 36-year period.

2.) Generic Strategy for Competitive Advantage 

Strategy emphasizes low costs & correspondingly low selling prices. Which allows them to achieving a competitive edge in the retail industry. 

3.) Business Model Choices Over Time 

Improved performes due to the new technologies & low prices obtained from vendors.

Increased volume by building new stores, expanding product variety, implementing the everyday low prices (EDLP)

4.) Pricing Syrategy & Competitive Advantage

Reputable sources in the retal industry. 

When examining a multinational company that operates within an oligopoly in the United States for the purpose of understanding its competitive advantage and forecasting techniques,

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